The complex architecture of the mammalian alveolus, has made it difficult to elucidate the balance of fluid secretion vs. absorption that characterizes the air-filled alveolar surface. Recent data from human alveolar Type 2 cells, utilizing novel thin film confocal microscopy, coupled with Ca(2+)(i), nucleotide release, and patch clamp studies, suggest that the physiology of fluid transport under air-filled conditions is substantially different from flooded conditions (in vivo flooded lung, Ussing chambers). Project III tests the hypothesis that the mammalian alveolus both absorbs and secretes fluid, and that the direction of fluid transport reflects signals contained in alveolar surface liquid, e.g., extracellular nucleotides. Project III will test this overarching hypothesis in four Specific Aims. Specific Aim 1 tests the hypothesis that purinergic signaling regulates the direction of AT2 fluid transport via coordinate inhibition of ENaC and activation of CFTR that reside in separate apical membrane compartments. Specific Aim 2 tests the hypothesis that regulation of secretory vs. absorptive functions can be characterized in novel single cell ATI assays. Specific Aim 3 tests the hypothesis that CFTR is not the only secretory pathway in the alveolus, e.g., 'alternative Cl(-) channels' and passive forces are important. Specific Aim 4 tests the hypotheses that: a) the intact alveolus in vivo balances active ion/water secretion and absorption; and b) that a fraction of the secreted liquid transits onto distal airway surfaces. The Project strategy is to build a knowledge base from studies of isolated AT2 cells and ATI cells with thin film confocal technologies, supplemented with novel single cell volume flow and conventional Ca(2+)(i), nucleotide release, and patch clamp technologies; then study the integrated alveolar physiology in vivo with complementary confocal and novel transgenic techniques to test whether data from isolated AT2/AT1 cells predict in vivo physiology. The overarching goal is to understand the regulation of the balance of liquids on alveolar surfaces in health, with an emphasis on purinoceptors, and utilize this information to design the necessary novel therapies to treat effectively pulmonary diseases with alveolar flooding as their main pathogenic feature.